Nothing in the Sun today about the manufactured (should I instead say, brewing?) Beers "scandal." Perhaps there are some adults over there who recognize the story was invented and, if Beers wanted to be truly mischievous, could provide fodder for a defamation suit. He's a public figure, but it might not be difficult to prove actual malice among the management and staff at the Sun.
Also in the Sunday papers ...
Dueling legislative postmortems by my colleague Steve Sebelius in the RJ and the Sun's Jon Ralston, who was the RJ's poltical columnist for more than a decade before joining the Evil Empire.
Both pieces are instructive in their way. Both writers are big government guys; their measure of "progress" is the size of the state's public sector, nevermind the fact that the schools (including the university system) are wretched; elected officials are in the hip pockets of gamers, developers and the public employee unions; law enforcement is corrupt; and the state pension system's unfunded liability will soon crowd out just about everything in the budget other than the lousy schools. (As you can guess, I'm not planning to apply for a job with the Nevada Development Authority any time soon.)
The advantage of reading Ralston is that he's become a part of the establishment he supposedly covers from the outside. (He makes no secret of his friendship with and admiration of Billy Vassliadis, local PR guru and super-lobbyist for the gaming industry.) By reading Ralston, you get an insiders' view from the inside. Hence, you end up with comments such as this, from today's story:
[The] business community -- whose critics said it once again executed its bait-and-switch on lawmakers, the gamers and the public, and sold out its smaller members, who would have been exempt under most of the other tax plans -- protected its larger constitutents.[Translation: Gamers are pissed because they couldn't strong-arm the Legislature into passing a revenue-based tax that would exempt casinos while pummeling large retailers and financial institutions, allowing a big increase in government spending with minimal impact on casino profits.]
Will the Asssembly Republicans continue to be deified by their supporters as leaders of a tax revolt and thus take over the lower house next session? Or will a coalition of gaming, construction, labor and mining (and maybe education activists) stick together, target a few of them and show they can still instill fear?
[Translation: How far will gaming and the teachers union {THAT'S the coalition} go to wrest back control of the Legislature? How many Assembly Republicans will they target by either: a) finding some patsy to bankroll in primaries against low-tax Republicans in safe districts, or b) financing Democrats to challenge incumbents in competitive districts?]
Sebelius hinted at this as well, with a nod to Star Wars:
If the session most recent was the rise of a rebellion against the established order, then the elections of 2004 may represent the bruised empire striking back."You want to do everything in a thoughtful and effective manner," says one gambling industry figure, discussing the future elections in genteel terms. "We're going to go about these decisions very methodologically." Translation: The empire can't afford to take on a high-profile target and lose. But a target or targets will have to be eliminated, at the risk of losing further prestige
This strategy is fraught with peril, as Steve's source acknowledges. For one thing, who's going to win election next year by saying , Your incumbent didn't raise your taxes enough? In the long term, this plan could backfire as well. 'Til now, gaming has hedged its political bets by giving money to every viable candidate of any party. If the casinos start targeting "disloyal" incumbents, a true, nonpartisan, anti-gaming coalition could form, comprising anti-tax libertarians, retirees, rank-and-file private sector union members (who no longer want to see their taxes increased so that overpaid public employees can get bigger raises) and anti-gaming religious conservatives (Las Vegas has the world's second-highest population of Mormons outside of Salt Lake City). If sufficiently energized, this group might eventually make it even tougher for casinos to have their way with the state's political processes.
As I've said here before, Nevada's population increased by 70 percent during the 1990s, and the growth shows no sign of abating. Many of these new residents are not completely dependent upon the gaming industry for their livelihoods. They have little knowledge of or contact with the handful of people who put Las Vegas on the map. To the extent that these newcomers reflect and enhance Nevada's reputation as a leave-us-alone, low-tax haven, it'll be difficult for state and local government to continue to consume a greater share of private wealth without some resistance from the residents who will be expected to pick up the tab. The next few years will mold Nevada's future, and an all-powerful gaming industry may not be a part of it.
More Ralston
What unintended consequences have been wrought by all of this? Court cases remain unresolved and more lawsuits surely will be filed, recalls are announced and planned, initiatives have begun to sprout. Will direct democracy overtake representative government in Nevada?
Consider the implications of that final question, that the initiative process has restricted "representative government." I would argue the opposite. While I'm neither a populist nor a Progressive, and the initiative process is a manifestation of both those political camps, as Steve Hayward and plenty of others have pointed out, initiatives have been used to take the decision-making process out of the hands of a professional political class and return it to elected representatives. In some cases initiatives have advanced a limited government agenda which was not being articulated by the professional political establishment.
Case in point: the two-thirds tax limitation amendment that's the source of the state's fiscal, legal and political turmoil. This manifestation of "direct democracy" has actually enhanced "representative government" in Nevada. Before the two-thirds requirement existed, a handful of elites from the state's top industries (typically gaming, real estate development and sometimes mining) met behind closed doors and decided what they wanted the Legislature to accomplish during its session. They would then buttonhole senior lawmakers and insist that the "representatives" find a simple majority of colleagues to do the bidding of the elites. This is what Ralston calls representative government -- representing the interests of the politically powerful, and this is the way the state was run for 125 years.
The power brokers tried the old formula again this year. But now, the supermajority requirement allows a cohesive minority to prevent any changes that do not appeal to broad segments of the population. It has actually given more influence to individual representatives and their constitutents. It has damaged the clout of the establishment.
The political left usually celebrates this sort of thing. Not Ralston. Then again, he bristles at being called a lefty.
The tax plan, outlined
This table and the accompanying story offer a side-by-side comparison of the Task Force tax proposal, what Guinn asked for, and what actually got through. Useful reference materials.
FDR or LBJ?
This thoughtful Jonathan Rauch essay from National Journal should generate a lot of discussion about the truly radical nature of the Bush administration's agenda. While Bush II appears to have little in the way of a governing philosophy, he's unafraid of taking huge risks (Iraq, the Middle East, serial tax cuts, the prescription drug benefit, the federal takeover of education, etc.) which could well backfire. If Bush succeeds, he'll be linked with FDR as a great wartime president; if he fails, he'll retire to Texas in disgrace, much like LBJ.
From the left, Matt Miller has contemplated the fiscal implications of the Bush tax cuts. A permanent extension of Bush's initial tax cuts, he says, would reduce the federal share of GDP from its current 21 percent to roughly 16 percent ... and yet, the retiring boomers will demand a dramatic expansion of government spending.
On the flip side, there's the new paper by Stanford economist Michael Boskin, who chaired the first President Bush's Council of Economic Advisers. Boskin noted that government revenue forecasts have failed to account for the taxable income that's locked up in deferred investment accounts (IRAs, 401(k)s, etc.) and projected that if these funds were taxed at a 28 percent rate, some $12 trillion in heretofore unanticipated revenues could be collected ... more than the unfunded liabilities of Medicare and Social Security combined.
Now Boskin is quick to admit that a lot of this money may never materialize in government coffers; the politically powerful boomers could easily prevail upon future Congresses to reduce tax rates or simply exempt large portions of this accumulated wealth from any taxable liability. Even so, if Uncle Sam can get his hands on a substantial amount of this money, Washington may be able to pay off its IOUs after all. Whether we'll be a freer or stronger nation as a result is another matter.
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